• Joey Lai

Financial Literacy

Financial Literacy - Financial literacy is the possession of the set of skills and knowledge that allows an individual to make informed and effective decisions with all of their financial resources. Understanding basic financial concepts allows people to know how to navigate in the financial system. People with appropriate financial literacy training make better financial decisions and manage money better than those without such training. - Wikipedia

Growing up, I was very fortunate to be in a household with two parents who taught us the value of money and the concept of savings. I still remember at a young age opening up my first account at the Wells Fargo Bank at Del Mar Highlands. While I grew up in a household that taught us the basic concept of money and savings, I still didn't know everything I needed to know when I went off to college and was on my own to make financial decisions.

My sophomore year of college I still remember getting out of class one day and there was a vendor fair on campus. There were a ton of financial vendors offering a free prize if you applied for a credit card. I got sucked in, and filled out a credit card application. 3 weeks later I had a platinum Visa with a $5,000 limit without having a source of income. One lunch on the credit card, turned in to two, and then a trip on the credit card, and so on. Each month I got my statement with a $50 payment a month. No big deal, right? I also didn't read that my APR was 24.99% and understand how making only the minimum payment would make it impossible to payoff the balance, while continuing to charge items on the card. I know times have changed in regards to applying for a credit card, but the basic concept/principles of interest and repayment have not.

One of the items I would like to initiate if elected, is a more robust education in regards to financial literacy starting in the lower grade levels, and getting more advanced as they get in to high school. Whether it be teaching about a checking accounts, interest, credit cards, personal loans, secure loans, mortgages, stocks, insurance, etc... the better we educate about finances at a younger age, the better chance our students will have at a more responsible financial start when they begin their own journey as an adult. In addition to educating, this will open their eyes to another industry to possibly pursue as a career.

How do we do this? Their are many curriculum's that have been built as well as financial partners who would volunteer to come and teach our students. It may not need to be a full blown curriculum implemented, but special guest teachers making periodic appearances to educate will make a huge impact. Had I known a little bit more about credit cards and interest, maybe I make a different decision in college, and not start my career with credit card debt. During Spring remote learning, I spent 30-45 minutes each day with Cole and Austin teaching them about real world topics. One of the topics I believe they enjoyed the most was teaching them the differences between a debit and credit card, as well as how the stock market works. Afterwards I got Austin his own Mastercard debit card that was tied to an app that tracked his spending and gave him insights on his spending patterns, while also allowing him to save and budget. (Greenlight Debit Card).

The quickest way to personal wealth is through homeownership, but the largest hurdles to achieve homeownership is savings for down payment and debt. Educating early can help our students make the right decisions so they can be as successful financially as possible right out of school. No matter what career path our students choose when they graduate, money and finances will matter and have an immediate impact on them, thus the need for more education on the topic.

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